The gif format does not support a full alpha (transparency) channel, so if you want antialiasing, you need to know the color of your background first, merge it with your text, color-select the background color, then delete it. You should be left with the text surrounded by a little bit of the background color (actually closer to the text color). The png format does support a full alpha channel, although, only some browsers make use of this feature (mozilla and IE5.?). I don't rely on it, rather use one bit of transparency and keep the .xcf file around in case if I ever need to change the background color. I'm not getting in a debate as to what the best format is. Most antialiasing uses 8 to 16 colors, so you shouldn't get a loss in quality.